While Cobb’s unemployment numbers have improved greatly, the state as a whole is facing a record number of unemployment claims and fraudulent claims are going to haunt the state and nation for years to come, Georgia Labor Commissioner Mark Butler said Thursday.
In September, Butler said Cobb’s unemployment rate was 5.6%, which was higher than the 3.1% the county saw in February pre-coronavirus, but still much better than the 11.4 % it hit in April.
“You’re still behind the eight ball, you’re still not fully recovered and have a significant number of people who haven’t gone back to work. But you’re seeing a very good recovery here in Cobb,” Butler said in his speech Thursday at the South Cobb Area Council meeting.
Overall, Butler gave a grim look into an overworked and understaffed state labor office.
“We have had four times the amount of claims than in the three worst years of the Great Recession with half of the staff. About $15.5 billion in benefits have been paid out. That’s more than the combined amount paid out in the last 28 years. That is astonishing,” Butler said.
He said the agency, which handles unemployment claims and the state’s labor market, has had a hard time itself hiring people to handle the huge demand.
“We’ve used temp agencies and brought back retirees because we need the help,” he said, adding he understands the struggles some businesses have had in hiring during the pandemic because many people are making more money on unemployment than they were at their actual jobs.
For example, Butler said his agency has handled over 4 million unemployment claims this year, with about 1.8 of those being valid. The most a person could make on unemployment (considering the additional $600 a week provided by the federal government) equaled out to about $24 an hour, or a little over $50,000 a year.
“If you were making $25,000, $30,000 a year working, and now you’re making $50,000 a year not working, you’re not going to go back. That’s a $20,000 difference. That person now knows what it’s like to live at that level of income. They’ve been exposed to it. And so hopefully, they’ll be encouraged to find a better job. But I see signs now saying, ‘We’re hiring, starting at $9 an hour,’ and I just laugh at them. Good luck. You need to get it up or you’re not going to hire,” he said.
Butler said his office raised the maximum someone could make at a job while still getting unemployment from $50 a week to $300 a week to encourage people to go back to work, even if just part-time. But while some programs like that have helped, Butler said the CARES Act threw his office some major curveballs.
“The CARES Act gifted us a bunch of new stuff, and it’s one of those things where it would have been great if they would have called us before they passed all of this and said, ‘Hey, is this possible? Can you do all of this?’ and I would have said, ‘no,’” he said.
One major issue he said was with the pandemic unemployment assistance, or PUA, which was implemented in the act and provided unemployment assistance to people who were getting paid through gigs, like musicians.
While he said he feels those individuals should have been provided unemployment assistance, his office was not equipped to handle their claims as they have no employer-provided information and they were not required to provide the name of a business. This, he said, has lead to record fraudulent claims, especially since July 1.
“It’s going to take years to unravel the fraud,” he added. “We’re trying to help the people who need it but then you run into cases where you know they are obviously trying to commit fraud and it causes a lot of issues. They didn’t require proof of a business with PUA, which made it easier to commit fraud and lie about how much you made. … That program has been a nightmare. Normally, it would have taken a year to test the program and get it going. Two weeks after it passed, we had applications coming our way.”
Butler also recommended tightening security on your financials and personal information, as data breaches have led to many people making claims and getting unemployment benefits through identity fraud.
Still, Butler said Georgia is in a much better position than many states, economically speaking, and he expects that trend to continue.
“The economy is trying its best to recover right now,” he said. “People are trying to hire right now. There is no state our size that has had a quicker recover than us. You could add up all of the states in front of us who have a better unemployment rate and they don’t have as many people in the workforce as we do — all of them combined. So I think we will see things improve.”